Amstutz, Obhof, LaRose talk about issues to come

Representative, senators see school funding, Medicaid, taxes on agendas

By BOBBY WARREN
Staff WriterPublished: January 23, 2013 4:00AM

WOOSTER -- Wayne County's state representative will once again be called upon to be the point person to carry Gov. John Kasich's budget through the Ohio House of Representatives.

State Rep. Ron Amstutz, a Wooster Republican, predicts the bulk of his work is going to be "managing the plethora of budget issues coming through the House Finance Committee" and the funding of the budgetary programs.

Three major areas that will consume a lot of Amstutz's attention in this General Assembly are school funding, tax reform and what to do with Medicaid. The same is true for state Sen. Larry Obhof Jr., who represents part of Holmes County, and Sen. Frank LaRose, who's 27th District includes all of Wayne County.

"The state has had a lot of trouble arriving at a consensus on a reasonable method to fund our schools," Amstutz said. "We've had three different funding methods in the past three budgets. This will be the fourth."

The state has tried a building blocks methodology, then an evidence-based model, which was never really implemented, and a bridge funding mechanism, Amstutz said. While he is not sure what the next funding model will look like, he believes it will be student-centered.

Kasich is expected to release his plan at the end of the month.

"You can tell where someone's heart is by where their resources are," LaRose said. The budget, and the way tax dollars are prioritized, "says a lot about the state."

"There is a lot of policy in the budget, it's not just a spending plan," LaRose said.

Obhof said he expects some significant tax reforms to come forward in this General Assembly. There will likely be some exemptions and loop holes that go away, and the revenue generated by this will be used to replace money lost from a significant income tax cut. What, exactly, the tax reforms look like will be clearer in February, Obhof said.

"There's still a view among many of us, and I am one of them, who still want to find ways to improve state taxes," Amstutz said. "State income taxes are still relatively high compared to other states. It's our main form of income, so we have to be careful."

In 2005, Amstutz was part of an effort in the Legislature to overhaul Ohio's tax structure. They reduced the income tax over several years, phased out the personal and tangible property tax, introduced a commercial activity tax and phased out a franchise tax for C-corporations. However, other forms of businesses, like S-corporations and partnerships, did not receive the tax break. As Amstutz sees it, the earlier reform effort created a tax inequity.

The state representative also would like to pursue uniformity in how political subdivisions impose income taxes on businesses.

"Ohio is almost unique in how local governments impose income taxes on individuals and businesses," Amstutz said. "The tax is set up differently in every community."

A person with a drapery business who worked in several cities would have to keep track of the time worked in each municipality, how much income was earned there and then pay an income tax, Amstutz said. In a bad year where money was lost, some cities allow for those losses to be carried forward.

"It creates a nightmare for small businesses," Amstutz said. "It is the main source of revenue for the local communities, so we have to be careful. But, we have to be more uniform."

"Medicaid is always a big issue," Obhof said. "We are discussing whether we expand it or not, as it is related to President Barack Obama's health care law."

If the state expands who is eligible to receive Medicaid, then the federal government will cover the difference, Amstutz said. However, he is not sure from where the money will come. It will cost billions of dollars; the federal government will either have to print money or borrow it to cover the gap.

Most health care officials say Ohio should expand Medicaid so more money will flow into the state, Amstutz said. "It will be very controversial. Some conservatives say we are in a conundrum -- they don't want to do it, but what (are) the implications of not doing it?"

An issue important to LaRose is how Ohio redraws its political boundaries every 10 years. He worked in a bipartisan fashion to pass Senate Joint Resolution 5 in which a seven-member redistricting commission, made up of the governor, state auditor, secretary of state and four members appointed by the legislative leaders in each chamber. The co-chairmen will be bipartisan and any proposed plan would need five votes, including at least one vote from the minority party.

The measure passed the Ohio Senate by a 32-1 count in December, but the House did not have enough time to take it up. It will probably be reintroduced during this General Assembly.

LaRose did not like how the lines were redrawn last year.

"We have a suboptimal way to draw lines, and we should not be surprised with its suboptimal results," he said. "It might be legal, but it is not optimal."

Issue 2, which aimed to reform the redistricting process, was defeated by voters at the polls. LaRose said the measure was rejected not because people do not want reform, rather because it was complicated and sought disinterested panels, which do not exist.

"We need to recognize it is a political process and put Republicans and Democrats at the table and require minority support to get the lines done," LaRose said.

There were complaints that Speaker of the House John Boehner's staff drew the lines for the Congressional District, and LaRose wants to ensure something like that does not happen again.

Another area LaRose is pursuing is dealing with how to clean up homes where methamphetamines were manufactured. The chemicals can get into the permeable materials inside a house, which could cause health problems for years. He would like to see some type of standards established.

Reporter Bobby Warren can be reached at 330-287-1639 or bwarren@the-daily-record.com. He is @BobbyWarrenTDR on Twitter.